How to set up a private company limited by guarantee in the UK

Liability: Each guarantor's liability is limited to the amount they guaranteed (including if they left within the previous 12 months).

Minimum capital: No share capital; set a guaranteed amount per guarantor (many use £1)

1. 1

   Confirm a guarantee company fits

   Guarantors, not shareholders, own and control the company, and profits are normally reinvested rather than paid out. Common for non-profits, clubs, associations and charitable companies.

2. 2

   Choose a name and decide on 'Limited'

   The name must end in 'Limited' or 'Ltd' unless your articles meet the exemption rules (objects such as commerce, art, science, education, religion, charity or a profession; no dividends). Dropping 'Limited' means registering by post.

3. 3

   Set the guaranteed amount and choose guarantors

   Each guarantor promises a fixed sum if the company cannot pay its debts, including if they left within the previous 12 months. Many set £1. You need at least one guarantor, who can also be a director.

4. 4

   Appoint at least one director

   Directors must be 16 or over and not disqualified or an undischarged bankrupt. A company secretary is optional.

5. 5

   Verify each director's identity

   Free via GOV.UK One Login or an authorised corporate service provider; you need each director's Companies House personal code to register.

6. 6

   Arrange a registered office and registered email

   An appropriate UK address in the nation of registration (no PO boxes) and a private registered email address.

7. 7

   Prepare articles and the statement of guarantee

   Model articles for private companies limited by guarantee are available. The statement of guarantee lists each guarantor's name, address and guaranteed amount and what they are liable for; each guarantor signs it.

8. 8

   Register with Companies House

   Online (£100) if all guarantors are individuals and you keep 'Limited' in the name; otherwise by post on form IN01 (£124) or through formation software (£100). Confirm the company's purpose is lawful.

9. 9

   Receive the certificate and set up tax

   Usually within 24 hours online, which also registers for Corporation Tax. If the company is a charity, also register with the Charity Commission once annual income reaches £5,000.

• Statement of guarantee (guarantors' names and addresses, guaranteed amount, signed by each guarantor)
• Articles of association (model articles for guarantee companies, or bespoke)
• Memorandum of association (created automatically online; paper IN01 needs the prescribed template)
• Registered office address (appropriate UK address; no PO boxes) and registered email address (private)
• SIC code(s)
• Director details and Companies House personal code for each director (identity verification)
• PSC details (a guarantor with over 25% of voting rights is a PSC) or a no-PSC statement
• Statement that the company is being formed for lawful purposes
• If dropping 'Limited' from the name: articles meeting the exemption conditions, and a postal application

• Register for Corporation Tax within 3 months of starting to do business unless the company is dormant (online incorporation registers you automatically).
• If the company is a charity: register with the Charity Commission when annual income reaches £5,000, and apply to HMRC for charity tax recognition.
• Register as an employer for PAYE before the first payday if you employ staff, and for VAT if taxable turnover passes £90,000.
• Open a bank account in the company's name and keep up-to-date records of members and directors.
• Make sure directors (and any PSCs) complete identity verification.
• Diarise the first confirmation statement and accounts deadlines.

• Confirmation statement at least every 12 months (£50 online).
• Annual accounts to Companies House within 9 months of the accounting reference date (21 months after incorporation for the first accounts if the first period is over 12 months).
• Company Tax Return to HMRC within 12 months of the period end if the company is within Corporation Tax.
• If a charity: annual return and accounts to the Charity Commission (within 10 months of the financial year end).
• Keep Companies House up to date on directors, PSCs, registered office and registered email.